Rising Cost of Healthcare Addressed in UM Experience Program
October 24, 2008
The rising costs of healthcare in the United States can be attributed to an aging population, increased life expectancy, technological innovations, and more services per person. That, according to Steven Ullmann, professor of management and economics and director of the School's programs in health sector management and policy, who addressed the issue in a recent presentation to alumni. The seminar, entitled “How Sick is Our Health System,” was part of the University of Miami's Audrey R. Finkelstein UM Experience program, which provides alumni with interactive educational opportunities, allowing them to share the experience of today's University of Miami students.
"People in the United States are spending more on healthcare than food and housing combined. And that was before the housing collapse," said Ullmann. "This is why people are trying to make choices these days about whether I put food on the table or whether I take my pharmaceuticals."
Currently, Americans spend, on average, over $7,000 on healthcare per person annually. Though the cost of healthcare has been steadily rising since the 1940s, Ullmann said one of the major causes of the sharp increase in recent years is employers extending additional benefits to employees during the economic growth of the early 2000s.
"You start taking your foot off the brake pedal, and the car just starts speeding right back up again," he said. "And that's exactly what started happening."
Government estimates show healthcare costs continuing to rise over the next 15 years. By 2015, Americans could be spending up to $4 trillion on healthcare and it is estimated that one out of every five dollars of economic activity will go to healthcare.
"The system is prone to significant distress and while there has been some focus on this, there has not been a systems approach to what is essentially a broken system. You either have to decrease benefits or reduce taxes and no one wants to do that," Ullmann said.